The Top Three Ways To Use The Equity In Your Home

August 18, 2015

There are numerous reasons why Canadians purchase homes . For many of us we enjoy the security that owing your own home offers, for others it is the appeal of having a valuable investment that offers different ways to increase our equity. Whatever your reason, there is no doubt that purchasing a home has proven to be an excellent investment – And many Canadians are profiting from it.

Using the equity you have built up in your home can be a good idea, but your are wise to use this equity with caution. Here are some ways that Canadians are using the equity in their home for their benefit.

#1 Getting Out Of Debt

If you have a lot of high interest debt then it might be a good idea to use some of the equity you have built up in your home to pay off that debt at a lower rate. For example if you have a large amount of credit card debt, where the interest is significantly higher than what you would be paying if you took out a second mortgage then this is one way for you to save a fair amount of cash in interest payments.

#2 Home Improvements

You can take advantage of the low rates that a home equity loan would provide to improve your investment which will make it more valuable and more comfortable. Home improvements are one the number one ways Canadians use the equity that they have built up in their home to their advantage.

#3 Investments

Some people have used the equity from their home to boost their RRSP contributions, or make other investments. This can be a little tricky, but if you get a higher rate of return on the money you take from your home then this could be beneficial. Purchasing a second property and then rent it out might also be something to consider.

Weight The Benefits And The Risks

Taking money out of your home can work, if you spend that money right. Be careful and make sure you are totally aware of the risks and how you will benefit. Consult with your investment and mortgage professional so they can help shed light on how to use this money in the best possible way.

For more information on Canadian Real Estate and Mortgage contact Scott Bowland of My Property Central.